mother wishes to gift to children

onthemend

hi

could someone advise on this scenario please. I've tried to search on line, but I get different answers.

Our mother has recently been bereaved from her late husband. She has inherited approximately £360K,

She currently lives in rented accomodation. So her total estate is worth £360K

She receives a very good pension which more than covers her living costs so doesn't need to use her assets. She is in good health and doesn't need any form of care.

1) she wishes to gift some of her estate to her 3 children, in the region of £50k each. Then continue to gift annually smaller amounts

Am I correct in thinking firstly she would also have her late husbands IHT threshold of £325k, so making her IHT threshold £650k?

Then, if she died within 7 years of making the gift, no IHT would be due because her estate is below the joint figure?

Look forward receiving any advice.

Keep_pedalling

You are correct in that under the current rules her estate will not fall into IHT territory.

The initial gift seems reasonable in that she is still keeping enough back to provide security for her later years, but she should be careful that she does not gift so much away that it would be deemed as deliberate deprivation of assets if she ever did need residential care.

Dox

Worth a read: https://www.ageuk.org.uk/information-advice/care/paying-for-care/paying-for-a-care-home/deprivation-of-assets/

Sounds as if it doesn't apply to your mum, but may be useful for anyone else reading this thread.

onwards&upwards

Is her rented accommodation secure and permanent and will it be suitable if she ever has mobility or other issues?

MovingForwards

Her income covers her current outgoings, what happens if her health declined and she requires daily care? Or has to move into a care home costing a few grand a month for a not-so-nice one?

onthemend

onwards&upwards wrote: »

Is her rented accommodation secure and permanent and will it be suitable if she ever has mobility or other issues?

yes, it's secure & permanent - its a McCarthy & Stone property

onthemend

MovingForwards wrote: »

Her income covers her current outgoings, what happens if her health declined and she requires daily care? Or has to move into a care home costing a few grand a month for a not-so-nice one?

The family will carry out daily care as we all live within 10mins drive. We'll then move he into one our properties should she decline further.

onwards&upwards

onthemend wrote: »

yes, it's secure & permanent - its a McCarthy & Stone property

The website looks like they develop apartments for sale, who owns it and what kind of tenancy is it?

onwards&upwards

onthemend wrote: »

The family will carry out daily care as we all live within 10mins drive. We'll then move he into one our properties should she decline further.

What if she requires specialist 24 hour care beyond the skills of family members?

Mojisola

onthemend wrote: »

The family will carry out daily care as we all live within 10mins drive. We'll then move he into one our properties should she decline further.

onwards&upwards wrote: »

What if she requires specialist 24 hour care beyond the skills of family members?

Or she doesn't want family members to be giving her very personal care like changing soiled pads?

Brynsam

I think this is all pretty irrelevant if the main driver is to avoid IHT (and OP's post is asking specifically about that). If her total estate is worth £360k, there won't be any, regardless of when any gifts were made.